One in four flights late in US in 2007 - long-lasting investment in ATC and airport upgrades needed

Analysis

The percentage of delayed flights in the US rose to their highest level last year since 2000, with 26.6% of flights delayed. In 2000, 27.4% of flights were delayed. On-time performance dropped from 75.4% in 2006 to 73.4% in 2007.

Despite the reduction in service quality, passengers paid more, with average domestic yields rising 1.2% year-on-year to USD 12.94 cents per RPM. Understandably, passengers weren’t happy, filing 13,168 complaints with the DoT last year – up 58.2% year-on-year.

The results, particularly the delays, highlight the crisis in the US air traffic control (ATC) system and the lack of progress in developing new airport infrastructure in the US. The system is straining under a 31% increase in flights since 2000.

Proposed solutions, including allowing airports to introduce peak time user charging, will not fix the long-term problems. A demand-sapping economic recession is the most likely reason the US could avoid crippling delays again this Summer.

Encouragingly, however, the Bush Administration is increasing investment in the Next Generation Air Transportation System (or NextGen) – a satellite system that will take nearly two decades to complete. In fiscal 2009, investment in NextGen technology will more than double to USD688 million.

But even this plan depends on Congress agreeing to the Government’s proposal to change the funding mechanism for the Airport and Airway Trust Fund, to shift away from an airline ticket tax to a user-pays method.

At the same time, the Bush Administration’s budget proposes USD765 million in cuts to the FAA's airport improvement programme to USD2.75 billion. That level of funding is USD1.1 billion below the current level in the FAA reauthorisation bill pending in Congress. According to Transportation Secretary, Mary Peters, the USD2.75 billion request was "based on our assessment of meeting safety needs”.

Rather than building new runways and terminals, budget proposals call for the purchase of more baggage screeners, with further security upgrades to be funded by a proposed USD1 per sector additional security charge for flights originating in the US.

Overall, the 2009 budget is a mixed outcome for an aviation industry requiring sustained investment to overcome key infrastructure bottlenecks. Perhaps it is time to allow the private sector a greater role in funding aviation infrastructure development. Chicago Midway Airport's potential privatisation this year could provide an example of the way forward.

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